Do liquidity induced changes in aggregate dividends signal aggregate future earnings growth?

Extant empirical literature does not provide abundant evidence for the information content hypothesis regarding firm-level dividend signaling. Although this is consistent with the argument against an optimal firm-level dividend policy, this does not imply an absence of an optimal aggregate dividend level. Aggregate dividends and earnings may exhibit stronger associations if aggregation filters out firm-specific earnings information and indicates macroeconomic trends. Using macroeconomic data, we show that aggregate payout ratios signal aggregate future earnings growth for horizons up to 4 years, and that excess aggregate liquidity plays an important role in this relationship.

Entrenched management,capital structure changes and firm value

The relationship between managerial share ownership and the firm’s change in leverage around a security issuance is examined. We find that entrenched managers are not more likely to issue equity, however they do affect lower leverage by choosing debt issuances which are smaller and equity issuances that are larger than those chosen by managers that are not entrenched. The magnitude of the decline in leverage that occurs from before the issuance to after the issuance is positively related to managerial share ownership. In addition, this relationship is confined to only the “entrenchment” range of managerial share ownership. The market reacts negatively to an issuance announcement when managerial share ownership is high.

Agency problems in tracking stock and minority carve-out decisions: Explaining the discrepancy in short- and long-term performances

Several studies have evaluated short- and long-term performances of parent firms who resort to restructuring via tracking stock or minority carve-out. Results show that short-term positive performance of restructuring parents turns negative in the long haul. Although researchers have attempted to resolve this inconsistency, a satisfactory explanation is yet to emerge. In this paper, we offer the self-serving behavior of restructuring parents’ managers as a potential explanation for the observed discrepancy in the short- and long-term performances. We argue that managers of parent firms create new units to receive additional compensation packages. We present evidence that the long-term negative performance can be attributed, at least partially, to self-awarded raise. Since managers of tracking stock parents enjoy a greater degree of managerial discretion and controls, we hypothesize that they would pay themselves a bigger compensation package than their carve-out counterparts and their long-term performance would be inferior to that of the latter group. Our results largely support these hypotheses.

Gender differences in positive perceptions,anxiety, and depression among mothers and fathers of children with intellectual disabilities: a logistic regression analysis

This study explores gender differences in positive perceptions, anxiety, and depression among mothers and fathers of children with intellectual disabilities (IDs). We examined the relationship between these variables and certain characteristics of both the child (age and severity of disability) and the parents (age, educational level, and employment status). A sample of 60 mother/father couples who had children with IDs completed the Positive Contributions Scale to measure their positive perceptions, and the Hospital Anxiety and Depression Scale to assess their level of anxiety and depression. Bivariate analyses were used to determine differences between fathers and mothers as regards their positive perceptions and levels of anxiety and depression. A logistic regression model was then applied to identify which of the variables might be significant predictors of the gender differences observed among parents. Both mothers and fathers had positive perceptions of their children with IDs that co-existed with symptoms of anxiety and depression, with scores being higher among mothers. The predictive analysis of gender showed that individual variables (such as the employment status of both parents) may explain these differences.     

Testing the higher education-led growth hypothesis in a small island: an empirical investigation from a new version of the Solow growth model

This study employs a new version of the Solow Growth Model in order to investigate the higher education-led growth (HELG) hypothesis in the case of North Cyprus. Results reveal that a long-run equilibrium relationship exists between real income growth of North Cyprus and its determinants, namely capital, labor, and the higher education sector. Results show that real income growth converges to its long-term equilibrium level by 10.9 %. Granger causality tests suggest undirectional causality from higher education growth to real income growth in North Cyprus. Therefore, the HELG hypothesis can be inferred for the Turkish Cypriot economy.     

Environmental versus Human-Induced Scarcity in the Commons: Do They Trigger the Same Response?

We study appropriation strategies in common pool resources where extinction is a credible threat. Here we present an experimental study of the appropriation of common pool resources in a dynamic setting where resource availability depends on the initial environmental characteristics of the common resource and on human-induced resource depletion due to users’ appropriation patterns. Our results show that initial resource scarcity limits appropriation by inducing an initial caution among users that persists throughout of the game. Additionally, we find that subjects restrain their appropriation strategies when scarcity increases. However, this concern for resource scarcity is not enough to prevent resource depletion. Agents do not counteract the previous rounds’ appropriation strategies but follow the appropriation trend. High appropriation levels are followed by higher appropriation strategies, thus promoting the well known tragedy of the commons. Often concern for resource preservation is not great enough to limit appropriation.      

Liberalisation,competition and ownership in the presence of vertical relations

This contribution analyses a market with an upstream bottleneck monopoly and a downstream activity that may either be vertically integrated or separated. Separation always reduces the consumer surplus, and the total surplus unless there are large cost reductions. Downstream competition from a public or private network monopoly would crowd out other firms, also when public ownership is associated with more modest objectives than welfare-maximisation. A market is therefore less likely to remain a mixed oligopoly than without vertical relations. However, private firms would survive in a moderately welfare-improving mixed oligopoly with cross-subsidisation and access charges equal to marginal costs.

The Eisner Puzzle,the Unemployment Threshold and the Range of Equilibria

Using a two-regime model of the inflation-unemployment process for US data 1960:2 to 2000:2, this paper finds strong evidence to support the Eisner puzzle, which occurs when the short-run Phillips curve (SRPC) is flatter at low rates of unemployment than at higher rates. The puzzling aspect of this pattern is the expectation of excess demand to become apparent at very low rates of unemployment causing the SRPC to be steep rather than fairly flat. We show the puzzle can be resolved by estimating a three-regime model which reveals a steep SRPC at very low rates of unemployment. The estimates of the three regime model also reveal a horizontal SRPC at intermediate rates of unemployment, implying the existence of a range of equilibrium rates of unemployment at those intermediate rates.

Mergers in asymmetric Stackelberg markets

It is well known that the profitability of horizontal mergers with quantity competition is scarce. However, in an asymmetric Stackelberg market we obtain that some mergers are profitable. Our main result is that mergers among followers become profitable when the followers are inefficient enough. In this case, leaders reduce their output when followers merge and this reduction renders the merger profitable. This merger increases price and welfare is reduced.